U.S. patent application number 12/536588 was filed with the patent office on 2011-02-10 for methods and apparatus for directing consumers to debt settlement providers.
This patent application is currently assigned to ENYFCU HOLDINGS, LLC. Invention is credited to Chris M. Langley.
Application Number | 20110035315 12/536588 |
Document ID | / |
Family ID | 43535550 |
Filed Date | 2011-02-10 |
United States Patent
Application |
20110035315 |
Kind Code |
A1 |
Langley; Chris M. |
February 10, 2011 |
Methods and Apparatus for Directing Consumers to Debt Settlement
Providers
Abstract
A consumer having a delinquent loan is directed to a debt
settlement provider by a data processing system comprising a data
processor in signal communication with a memory. Initially, the
data processing system obtains a credit report for the consumer
reflecting at least a portion of the consumer's credit history. The
data processing system then determines the delinquent loan of the
consumer directly from this credit report. Finally, the data
processing system transmits information about the consumer and the
delinquent loan to the debt settlement provider.
Inventors: |
Langley; Chris M.; (Port
Jervis, NY) |
Correspondence
Address: |
LAW OFFICES OF MICHAEL L. WISE, LLC
260 WALSH RD.
LAGRANGEVILLE
NY
12540
US
|
Assignee: |
ENYFCU HOLDINGS, LLC
Ferndale
NY
|
Family ID: |
43535550 |
Appl. No.: |
12/536588 |
Filed: |
August 6, 2009 |
Current U.S.
Class: |
705/38 ;
705/35 |
Current CPC
Class: |
G06Q 40/025 20130101;
G06Q 40/00 20130101 |
Class at
Publication: |
705/38 ;
705/35 |
International
Class: |
G06Q 40/00 20060101
G06Q040/00 |
Claims
1. A method of directing a consumer having a delinquent loan to a
debt settlement provider, the method to be performed by a data
processing system comprising a data processor in signal
communication with a memory, the method comprising the steps of:
obtaining a credit report for the consumer reflecting at least a
portion of the consumer's credit history; determining the
delinquent loan of the consumer directly from the credit report;
and transmitting information about the consumer and the delinquent
loan to the debt settlement provider.
2. The method of claim 1, further comprising the step of providing
the credit report to the consumer.
3. The method of claim 2, wherein the providing step comprises
transmitting data formatted for presentment by a web browser.
4. The method of claim 1, wherein the obtaining step comprises
obtaining the credit report from a credit bureau.
5. The method of claim 1, wherein the determining step comprises
parsing contents of one or more tradelines in the credit
report.
6. The method of claim 1, wherein the determining step comprises
converting at least a portion of the credit report to a format in
accordance with the Extensible Mark-up Language.
7. The method of claim 1, further comprising the step of offering
the consumer a choice whether to transmit information about the
consumer and the delinquent loan to the debt settlement
provider.
8. The method of claim 7, wherein the offering step comprises
providing the consumer with an amount of the delinquent loan.
9. The method of claim 7, wherein the offering step comprises
providing the consumer with a proposed settlement amount for the
delinquent loan.
10. The method of claim 1, further comprising the step of receiving
a request from the consumer to provide the credit report.
11. The method of claim 1, further comprising the step of providing
the consumer with an estimate of a change to a credit score of the
consumer that may result from the consumer settling the delinquent
loan.
12. A data processing system operative to direct a consumer having
a delinquent loan to a debt settlement provider, the data
processing system comprising: a memory portion; and a data
processor portion in signal communication with the memory portion,
the data processor portion operative to obtain a credit report for
the consumer reflecting at least a portion of the consumer's credit
history, determine the delinquent loan of the consumer directly
from the credit report, and transmit information about the consumer
and the delinquent loan to the debt settlement provider.
13. The data processing system of claim 12, wherein the data
processor portion is operative to act as a web server.
14. The data processing system of claim 12, wherein the data
processor portion is operative to transmit data formatted for
presentment by a web browser.
15. The data processing system of claim 12, wherein the data
processor portion is operative to parse one or more tradelines in
the credit report.
16. The data processing system of claim 12, wherein the data
processor portion is operative to provide the consumer with an
amount of the delinquent loan.
17. The data processing system of claim 12, wherein the data
processor portion is operative to provide the consumer with a
proposed settlement amount for the delinquent loan.
18. Computer instructions embodied on one or more computer-usable
media for directing a consumer having a delinquent loan to a debt
settlement provider, the computer instructions, when executed by a
computer having a data processor in signal communication with a
memory, operative to cause the computer to perform the steps of:
obtaining a credit report for the consumer reflecting at least a
portion of the consumer's credit history; determining the
delinquent loan of the consumer directly from the credit report;
and transmitting information about the consumer and the delinquent
loan to the debt settlement provider.
Description
FIELD OF THE INVENTION
[0001] The present invention relates generally to methods and
apparatus for providing financial services, and, more particularly,
to data processing systems and methods to be performed on data
processing systems for directing consumers with delinquent loans to
debt settlement providers.
BACKGROUND OF THE INVENTION
[0002] Debt settlement, also known as "debt arbitration" or "debt
negotiation," is a process in which a debtor makes an agreement
with a creditor to pay off a debt at an amount less than the
outstanding balance. Typically, a debtor only qualifies for debt
settlement when the creditor is convinced that the debtor is
experiencing some kind of financial hardship that prevents the
debtor from being able to fully repay their debts. Debt settlement
almost always involves debts that are unsecured, such as medical
expenses, utility bills, and credit card debt. Debt secured by
collateral, such as car loans or home mortgages, are generally not
eligible for debt settlement because the debtor may pursue relief
for non-payment by repossessing the collateral.
[0003] Debt settlement is frequently facilitated by a third party
service provider, a debt settlement provider (DSP). Such providers
will negotiate with a creditor on behalf of a debtor and develop a
debt settlement program. In such a program, a debtor is usually
directed to start depositing money in a settlement account in lieu
of paying the creditor. Subsequently, once these deposited funds
are judged sufficient, the DSP attempts to negotiate a settlement
offer with the creditor. Depending on the circumstances, the debtor
may only have to pay 35-60% of the existing balance.
[0004] The DSP, in turn, profits by charging a fee. The manner in
which this fee is calculated varies. Some DSPs charge a percentage
of the total settled debt as their fee, while others charge a
percentage of the debt reduction they are able to negotiate. Even
others charge a monthly fee. Accordingly, if a DSP is able to
obtain a sufficient customer base, debt settlement may be very
lucrative. For this reason, many DSPs desire to advertise their
services. Nevertheless, such advertising is difficult to target at
those consumers that may actually benefit from debt settlement
services, and is also typically very expensive. The
return-on-investment from such advertising is, therefore, often
unsatisfactory.
[0005] There is, as a result, a need for methods and apparatus that
detect consumers that might benefit from debt settlement services,
educate those consumers about the benefits of debt settlement in a
compelling manner, and direct those consumers to DSPs that may be
able to serve them.
SUMMARY OF THE INVENTION
[0006] Embodiments of the present invention address the
above-identified need by providing methods and apparatus that
detect consumers that may benefit from debt settlement services and
refer those consumers to participating DSPs.
[0007] In accordance with an aspect of the invention, a consumer
having a delinquent loan is directed to a DSP by a data processing
system comprising a data processor in signal communication with a
memory. Initially, the data processing system obtains a credit
report for the consumer reflecting at least a portion of the
consumer's credit history. The data processing system then
determines the delinquent loan of the consumer directly from this
credit report. Finally, the data processing system transmits
information about the consumer and the delinquent loan to the debt
settlement provider.
[0008] In accordance with one of the above-described embodiments of
the invention, a debt settlement referral system (DSRS) comprises a
data processing system operative to communicate with a consumer
over the Internet. In response to a request from the consumer, the
DSRS obtains a credit report for the consumer and determines any
delinquent loans directly from the credit report. The DSRS then
presents the consumer with their credit report as well as with a
debt settlement referral offer. The debt settlement referral offer
summarizes the consumer's delinquent loans, provides a proposed
settlement amount, and offers the consumer an opportunity to have
the DSRS forward information about the consumer and the consumer's
loans to a DSP.
[0009] Advantageously, the above-described embodiment allows the
consumer to conveniently learn about debt settlement services and
to be easily put in contact with a participating DSP. The DSP, in
turn, receives a lead on a consumer who is in a financial situation
that lends itself to debt settlement and who is potentially
interested in receiving debt settlement services.
BRIEF DESCRIPTION OF THE DRAWINGS
[0010] These and other features, aspects, and advantages of the
present invention will become better understood with regard to the
following description, appended claims, and accompanying drawings
where:
[0011] FIG. 1 shows block diagram of a DSRS and various external
elements in accordance with an illustrative embodiment of the
invention;
[0012] FIG. 2 shows a flow chart of the configuration portion of an
illustrative method embodiment for providing debt settlement
referral services to a consumer;
[0013] FIG. 3 shows an illustrative set of debt settlement
parameters;
[0014] FIG. 4 shows a flow chart of the debt settlement referral
portion of the illustrative method embodiment for providing debt
settlement referral services to a consumer;
[0015] FIG. 5 shows an illustrative web page that requests
indentifying information from the consumer;
[0016] FIG. 6 shows an illustrative credit report; and
[0017] FIG. 7 shows an illustrative web page that provides the
consumer with a credit report and debt settlement referral
offer.
DETAILED DESCRIPTION OF THE INVENTION
[0018] The present invention will be described with reference to
illustrative embodiments. For this reason, numerous modifications
can be made to these embodiments and the results will still come
within the scope of the invention. No limitations with respect to
the specific embodiments described herein are intended or should be
inferred.
[0019] FIG. 1 shows a debt settlement referral system (DSRS) 100
for providing financial services in accordance with an illustrative
embodiment of the invention. The illustrative DSRS is connected to
several external elements, namely a plurality of consumers 110, a
DSP 120, a credit bureau 130, and a secure remote database 140 via
a network 150. The DSRS itself comprises a network server portion
160, a data processing portion 170, and a memory portion 180. These
three portions combine to form a data processing system, and each
portion performs a particular function within the DSRS. More
specifically, the network server portion is operative to receive
and transmit data over the network between the DSRS and the
external elements. The data processing portion comprises a data
processor and is operative to perform the logical steps and
computations associated with the debt analysis operations, and to
generate analysis data. Finally, the memory portion is operative to
store data associated with the debt analysis operations. The
network, data processing, and memory portions may comprise, for
example, AS/400.RTM., iSeries , or i5.RTM. servers available from
International Business Machines Corporation (Armonk, N.Y., USA), or
any analogous server-type computers.
[0020] It should be noted that the three portions 160, 170, 180
forming the DSRS 100 may, in fact, be implemented in a single
computer or implemented in several linked computers. Their
presentation as three separate elements in FIG. 1 is merely to draw
attention to their functionality rather than to present their
physical form. Once their novel functionality is understood, the
programming of the computer or computers to implement the
functionality will be well within the ability of one of ordinary
skill in the art.
[0021] The network 150 preferably comprises the Internet (i.e.,
World Wide Web), allowing the consumers 110 to access the DSRS 100
using any internet-capable computer with a web browser program,
such as a personal computer, cellular telephone, or personal
digital assistant. This allows the DSRS to present its debt
referral content to consumers in the form of information on web
pages (i.e., this allows the DSRS to act as a web server that sends
data formatted for presentment on web browser programs).
Accordingly, computer-to-computer communications between the DSRS
and the consumers is preferably performed using the Hypertext
Transfer Protocol (HTTP), the Secure Sockets Layer (SSL) Protocol,
or some combination thereof. For communication between the DSRS and
the other external elements 120, 130, 140, the Internet may also be
utilized or a more private network connection may be chosen.
Alternative network connections may include, as just a few
examples, point-to-point (leased line), circuit switched, or packet
switched Wide Area Networks (WANs).
[0022] As will be described in greater detail below, the DSP 120
voluntarily enrolls with the DSRS 100 to become a "participating"
DSP in order to gain exposure to consumers 110 that may be
interested in acquiring debt settlement services. For ease of
understanding, only a single participating DSP is shown in FIG. 1,
but it is possible that several different DSPs may be enrolled with
the DSRS at any given time.
[0023] Lastly, the credit bureau 130 comprises one or more
databases that store credit history data for the consumers 110. The
databases may, for example, be populated with consumer credit
history data collected by one or more of the three largest credit
bureaus, namely Experian.RTM. (West Orange, Calif., USA),
TransUnion.RTM. (Chicago, Ill., USA), and Equifax.RTM. (Atlanta,
Ga., USA). The secure remote database 140, on the other hand, is a
database external to the DSRS 100 that, in the present illustrative
embodiment, is primarily tasked with storing sensitive financial
information about the consumers. Such sensitive information may
include, for example, the data gleaned from the consumers' credit
reports. Safeguards such as data encryption and other methodologies
known in the art are preferably utilized to protect data stored in
the secure remote database. The secure and remote nature of the
secure remote database is utilized in response to governmental
regulatory requirements and consumer expectations for securing this
kind of sensitive personal information.
[0024] The function of the different elements in FIG. 1 will now be
described with reference to an illustrative "direct-to-consumer"
method embodiment for providing debt settlement referral services
to consumers in accordance with aspects of the invention. For ease
of understanding, the illustrative method can be broken up into two
portions: a configuration portion, and a debt settlement referral
portion.
[0025] FIG. 2 shows a flow chart of the configuration portion 200
of the illustrative method embodiment wherein the DSRS 100 receives
and stores data from the participating DSP 120 for later use in
servicing the consumers 110. In step 210, the DSRS receives and
stores a set of debt settlement parameters for the DSP. In the
present embodiment, the debt settlement parameters comprise three
parameters, namely: 1) the number of months required to cause an
account that is not already in collections to be sufficiently past
due to qualify for debt settlement; 2) the settlement percentage
for such "sufficiently past due accounts"; and 3) the debt
settlement percentage for accounts already in collections
("accounts-in collections"). As used herein, the term "debt
settlement percentage" indicates the percentage of the outstanding
debt balance that the DSP will offer to pay a creditor on behalf of
a debtor in order to extinguish that debtor's debt with the
creditor. For example, FIG. 3 shows a set of debt settlement
parameters 310 for an exemplary DSP, "ABC Debt Settlement Company,"
presented in the form of a table. These debt settlement parameters
indicate that ABC Debt Settlement Company will attempt to settle an
unsecured loan that is more than 3 months past due, but not yet in
collections, for an amount equal to 60% of the outstanding balance.
ABC Debt Settlement Company will attempt to settle an unsecured
loan presently in collections for 45% of the outstanding
balance.
[0026] FIG. 4 goes on to show the debt settlement referral portion
400 of the illustrative method embodiment. This portion is
performed after a consumer 110 accesses the web site of the DSRS
100. In step 405, the DSRS offers to provide the consumer with the
consumer's credit report. Many consumers will periodically order
their credit reports in order to determine the status of their
existing debts, their credit scores, whether the reports contain
any errors, and whether there are any indications of identity
fraud. If the consumer indicates that the consumer desires to
receive the credit report, the DSRS moves on to step 410 and the
DSRS obtains identifying information from the consumer. This may be
performed by querying the consumer for the consumer's name,
address, social security number, birth date, mother's maiden name,
and other such identifying information. FIG. 5 shows an
illustrative web page that might be presented to the consumer
during step 410. Once this identifying information is received, the
DSRS advances to step 415 and utilizes the information obtained in
the previous step to obtain the consumer's credit report from the
credit bureau 130.
[0027] FIG. 6, in turn, shows what the credit report obtained in
step 415 might look like. This particular credit report is in a
text format that is typical of credit reports generated by
Experian. Credit reports provided by other credit bureaus may be
formatted somewhat differently, but typically include similar
information. The report has several elements and codes that will be
familiar to one skilled in the art and that are readily understood
by reference to descriptive materials available from the credit
bureaus and elsewhere. Briefly, in addition to personal data such
as name and address, the report describes the consumer's public
records on bankruptcies, liens, and civil law suits. In addition,
the consumer's loan history, including existing and past loans, is
presented in what are normally called "tradelines" or "trades." The
credit report may also present information on "hard" inquiries made
by third parties (e.g., lenders) to the credit bureau, as well as
the consumer's credit score.
[0028] As can be seen in the credit report sample shown in FIG. 6,
the tradelines (trades) provide detailed parameters for each of the
consumer's existing loans. The tradelines, for example, include the
loan type, original balance, term, opening date, monthly payment,
and last payment. In addition, the tradelines also provide a
Payment History Section (far right on FIG. 6) which utilizes a
series of numerical and letter codes to indicate the monthly status
of the account over the past several months. In the present report,
for example, a "C" in the Payment History Section indicates that
the account was current on that month, while a numeral between "1"
and "6" indicates that the account was past due by that number of
months, and a "G" indicates that the account was in collections.
The present report further provides a Payment Status Indicator
(also far right on FIG. 6). Here a "DELINQ 90" notation indicates
that the account is presently 90 days past due, a "DELINQ 180"
notation indicates that the account is presently 180 days past due,
and a "COLLACCT" notation indicates the account is presently
already in collections.
[0029] Next, in step 420 of FIG. 4, the DSRS 100 searches the
credit report for sufficiently past due accounts and
accounts-in-collections (hereinafter, collectively called
"delinquent accounts"). In accordance with aspects of the
invention, it does so solely by reference to the credit report
obtained in step 415. More specifically, the DSRS parses the data
presented in the credit report's tradelines to determine any
existing loans that are past due by the number of months required
to define a loan as sufficiently past due (as indicated in the debt
settlement parameters 310) as well as any existing loans that are
already in collections. If the credit report is similar to that
shown in FIG. 6, for example, the DSRS may determine the delinquent
accounts by examining the information provided in one or both of
the credit report's Payment History and Payment Status Indicator
sections, as indicated above.
[0030] The actual parsing of the credit report to determine any
delinquent accounts in step 420 is performed by conventional data
processing methods that will be familiar to one of ordinary skill
in the art. Although not the only method coming within the scope of
this invention, the credit report data may be, for example,
initially converted into an Extensible Mark-up Language (XML)
format in conformity with specifications provided by the Mortgage
Banker's Association of America Mortgage Industry Standards
Maintenance Organization (MISMO). In this manner, credit report
data provided by different credit bureaus is normalized and
provided with standardized XML descriptors and wordings. Commercial
software, such as the MERit Credit Engine from Merit Credit
Systems, Inc. (Montrose, Calif., USA), is available to perform this
kind of processing on credit report data. Once so formatted, the
DSRS 100 can easily cycle through the XML data and extract the
desired account information. The XML format is also a convenient
format for storing the credit report data for later use. In the
present example, the data may be stored in the secure remote
database 140.
[0031] In step 425, the method 400 branches based on the results of
step 420. If the DSRS 100 did not find any delinquent accounts, the
system advances to step 430, wherein it presents the credit report
to the consumer as requested by the consumer in step 405. If,
instead, the DSRS did find one or more delinquent accounts, it
advances to step 435 and begins the process of preparing an offer
to the consumer for referral to the DSP 120 (i.e., it begins to
prepare a "debt settlement referral offer").
[0032] Preparation of the debt settlement referral offer begins in
step 435, wherein the DSRS 100 calculates the proposed debt
settlement amount. The proposed debt settlement amount, PDSA, is
simply:
PDSA=(B.sub.SPDA.times.SP.sub.SPDA)+(B.sub.AIC.times.SP.sub.AIC),
where B.sub.SPDA is the balance due on any sufficiently past due
accounts, SP.sub.SPDA is the settlement percentage for sufficiently
past due accounts, B.sub.AIC is the balance due on any
accounts-in-collections, and SP.sub.AIC is the settlement
percentage for accounts-in-collections. Both SP.sub.SPDA and
SP.sub.AIC can be determined from the debt settlement parameters
310. If, for example, the consumer 110 has sufficiently past due
accounts with a combined outstanding balance of $6,123, and has
accounts-in-collections with a combined outstanding balance of
$4,111, then the proposed debt settlement amount would be
calculated to be $5,224 based on the settlement percentages
provided in the exemplary debt settlement parameters shown in FIG.
3.
[0033] In step 440, the DSRS 100 then presents the consumer 110
with the consumer's credit report in combination with the debt
settlement referral offer. FIG. 7 shows an illustrative example of
such a combined presentation, which is displayed for the consumer
in the form of a web page (debt settlement referral offer in upper
right). The debt settlement referral offer summarizes the total
outstanding balance for delinquent accounts found in step 420, and
also provides the consumer with the proposed debt settlement amount
calculated in step 435. Lastly, the debt settlement referral offer
provides the consumer with a button which allows the consumer to
select whether that consumer wants to contact the DSP 120 regarding
debt settlement services.
[0034] In addition, and optionally, the debt settlement referral
offer may also provide the consumer 110 with an estimate of the
manner in which that consumer's credit score may be improved by
settling the delinquent accounts using the services of the DSP
120.
[0035] Next, as indicated in step 445, the illustrative method 400
ends if the consumer 110 chooses not to accept the debt settlement
referral offer. If, on the other hand, the consumer accepts the
offer, the DSRS 100 advances to step 450. Here, the DSRS forwards
the consumer's relevant information to the DSP 120 including the
consumer's identifying information, credit report, delinquent
accounts, and proposed debt settlement amount. The DSP is then able
to contact the consumer directly and pursue a business relationship
with the consumer if the DSP so desires.
[0036] In this manner, the illustrative debt settlement referral
method 400 allows the consumer 110 to conveniently learn about debt
settlement services that may help that consumer substantially
improve the consumer's financial situation. Such information may be
very compelling to the consumer because the consumer is reminded
about that consumer's present debt situation and also learns that
the consumer may only have to pay a fraction of the consumer's
outstanding debts to extinguish those debts. In addition, the DSRS
100 allows the consumer to be put in contact with the DSP 120
merely by selecting a single button on a web page. The DSP, in
turn, receives a lead on a consumer who is in a financial situation
that lends itself to debt settlement and is potentially interested
in pursuing debt settlement negotiations with that consumer's
creditors. The DSP is then free to pursue that lead directly with
the consumer in order to provide those services.
[0037] It should again be emphasized that the above-described
embodiments of the invention are intended to be illustrative only.
Other embodiments can use additional or different types and
configurations of elements and process steps for implementing the
described functionality. These numerous alternative embodiments
within the scope of the appended claims will be apparent to one
skilled in the art.
[0038] Moreover, all the features disclosed herein may be replaced
by alternative features serving the same, equivalent, or similar
purpose, unless expressly stated otherwise. Thus, unless expressly
stated otherwise, each feature disclosed is one example only of a
generic series of equivalent or similar features.
* * * * *